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Housing

What is the Renters Reform Bill and how will it change things for renters?

The much-delayed Renters Reform Bill has finally been revealed alongside promises to redress the power balance between landlord and tenant.

It has been a long wait but the Westminster government has finally detailed the Renters Reform Bill – its plan to redress the power balance between landlord and tenant.

The bill was first proposed in April 2019 in a bid to remove some of the insecurities tenants experience while private renting in England.

It has been three years and a pandemic since that announcement.  But the Renters Reform Bill was included in the Queen’s Speech in May 2022 with Prince Charles promising a bill “to strengthen the rights of tenants” in the speech.

A month later, the government revealed its ‘New Deal for renters’ promising the biggest reforms to the private rented sector for decades. Now the proposed legislation will make its way through parliament before coming into law.

But what is the Renters Reform Bill and what is it trying to achieve? Let The Big Issue explain.

What is the Renters Reform Bill?

Theresa May’s government first announced the bill in April 2019 as a “step change” in protections for renters, ending no-fault evictions and giving landlords and tenants more rights. It was hailed as “the biggest change to the private rental sector for a generation”.

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Announcing the plans, the then-prime minister said: “Everyone in the private sector has the right to feel secure in their home, settled in their community and able to plan for the future with confidence.

“But millions of responsible tenants could still be uprooted by their landlord with little notice, and often little justification.

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“This is wrong – and today we’re acting by preventing these unfair evictions. Landlords will still be able to end tenancies when they have legitimate reasons to do so, but they will no longer be able to unexpectedly evict families with only eight weeks’ notice.”

It took until June 2022 for the Conservative government, now headed by Boris Johnson, to reveal its plan with the Fairer Private Rented Sector White Paper.

So how will the bill change things for 4.4 million private renters in England?

The main target for the reforms is the abolishment of section 21 evictions, often called ‘no fault’ evictions. Removing the clause from the Housing Act 1988 will allow “security for tenants in the private rented sectors and empower them to challenge poor practice and unfair rent increases without fear of retaliatory eviction”.

The government will also look to improve standards in rented accommodation with a Decent Homes Standard and explore the introduction of a national landlord register much like the one in operation in Scotland.

The bill will also look to create a new ombudsman for renters to take complaints against landlords without going to court. A new portal to help tenants track their landlord’s performance and hold them to account is also included in the draft legislation plans.

Under the plans, it will be made illegal for a landlord to bring in a blanket ban on renting to families with children or to people who receive benefits. Tenants will also get the right to ask their landlord if they can keep a pet with landlords forced to consider it. The government said landlords “cannot unreasonably refuse” the tenant’s request.

Overall, the bill is looking to give more power to renters to allow them to exert their rights with ministers taking the view that the power dynamic has shifted too far towards landlords in recent times.

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The move has largely been welcomed by housing charities, campaigners and anti-poverty organisations.

Acorn head organiser Nick Ballard said: “Today marks a victory for organised tenants who have been fighting in their communities and in the corridors of power for decent, dignified and affordable housing for all. 

“In the context of this bill, the housing movement has united together under the banner of the Renters Reform Coalition to present the changes renters need and deserve, and it is great to see that many of these have been acknowledged.”

Alicia Kennedy, the director of Generation Rent added: “If the government can get the detail right and give tenants the confidence they need to request improvements and plan for the long term, this legislation has the potential to improve the lives of millions throughout England.”

When will the Renters Reform Bill become law?

There is no set time limit for when the bill will come into force and it will now be scrutinised by peers and MPs as it makes its way through parliament.

The legislation must now pass through multiple stages in the House of Lords and the House of Commons before making it into law.

Shelter chief executive Polly Neate warned the plans “must keep their teeth” as they move through parliament. Citizens Advice’s Dame Claire Moriarty said renters “need to see these proposals put through parliament as soon as possible”.

Has the Section 21 notice been abolished?

It has been three years since ministers promised to axe section 21 evictions but they are still in operation – and will remain so until the Renters Reform Bill comes into force to axe them for good.

The notice can be issued by private landlords without any requirement to give a reason and critics have long argued that the practice can drive homelessness and mean tenants never have a chance to settle in their homes due to fear of eviction.

Landlords can issue a section 21 notice for genuine reasons such as anti-social behaviour or the need to reclaim the property from a tenant who is damaging it. But on other occasions they can be used for getting a property back to sell it or — in some cases — for personal reasons if the landlord and tenant have fallen out.

Before the pandemic, the lossof a tenancy was the leading driver of homelessness and the government stepped in to ban evictions during the pandemic to prevent people from losing their home.

Section 21 notices have been issued thousands of times since Theresa May’s government pledged to axe them in 2019.

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Nearly 230,000 private renters have received a no-fault eviction notice since according to a Shelter and YouGov survey released in April 2022 to mark three years since May’s promise.

That equates to a renter receiving a section 21 notice once every seven minutes over the period despite an eviction ban protecting tenants during the pandemic.

“It’s appalling that every seven minutes another private renter is slapped with a no-fault eviction notice despite the government promising to scrap these grossly unfair evictions three years ago. It’s no wonder many renters feel forgotten,” said Shelter chief executive Polly Neate. 

Section 21 notices are also beginning to see more households calling on councils to prevent homelessness. The 5,260 households who asked local authorities for support between October and December 2021, according to official figures, represents the first time this figure had risen above pre-pandemic levels.

It’s important to note that it is not just ministers and tenants who think that ‘no-fault’ evictions need to go, landlords accept that reforms are needed as well. The National Residential Landlords Association has spoken up in favour of axing them – as long as there is an agreed mechanism to replace them that allows landlords to reclaim properties quickly when needed.

Last year Ben Beadle, the chief executive of the National Residential Landlords Association, said: “Whilst we condemn any landlord who abuses the system, it is vital to remember that the vast majority of tenants and landlords enjoy a good relationship. It is in that spirit that the government should develop its plans for a system to replace Section 21 in its forthcoming white paper on rental reform.”

Can a landlord charge whatever they want?

A landlord can charge whatever they like for a property – there is no law setting a maximum amount.

Instead it is up to the property market to define the price a renter pays. For example, if a landlord charges too high of a price then it is unlikely they will find a tenant for the property.

However, the lack of supply in the rental market means rents are rising at the fastest rate on record. This is because renters have fewer choices and that is driving rents up because they have no option but to accept a higher rate.

This is a problem that is not going to be solved by the Renters’ Reform bill. Instead, the only answer is an effort to build more affordable homes – a current target for the Westminster government.

However the bill will mean that renters should not face unfair rent hikes. Arbitrary rent review clauses will be scrapped under the reforms, which will restrict tribunals from increasing rents and allow tenants to be repaid rent for living in non-decent homes.

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